Affidavit...L\336056700.3 3 7. I also refer to and rely upon the affidavit of Salvatore Algeri of 22 May 2020 (Algeri Affidavit). 8. Exhibited to me at the time of swearing this affidavit

$Page 1: Affidavit...L\336056700.3 3 7. I also refer to and rely upon the affidavit of Salvatore Algeri of 22 May 2020 (Algeri Affidavit). 8. Exhibited to me at the time of swearing this affidavit$
1

Filed on behalf of (name & role of party) The Plaintiffs

Prepared by (name of person/lawyer) Timothy James Sackar

Law firm (if applicable) Clayton Utz

Tel +61 2 9353 4000 Fax +61 2 8220 6700

Email [email protected]

Address for service (include state and postcode)

Level 15, 1 Bligh Street, Sydney NSW 2000

[Version 3 form approved 02/05/2019]

L\336056700.3

Form 59 Rule 29.02(1)

Affidavit

No. NSD 464 of 2020 Federal Court of Australia

District Registry: New South Wales

Division: Commercial and Corporations List

IN THE MATTER OF VIRGIN AUSTRALIA HOLDINGS LTD (ADMINISTRATORS APPOINTED) ACN 100 686 226 & ORS

VAUGHAN STRAWBRIDGE, SALVATORE ALGERI, JOHN GREIG AND RICHARD HUGHES, IN THEIR CAPACITY AS JOINT AND SEVERAL VOLUNTARY

ADMINISTRATORS OF VIRGIN AUSTRALIA HOLDINGS LTD (ADMINISTRATORS APPOINTED) AND THE THIRD TO FORTIETH PLAINTIFFS NAMED IN SCHEDULE 1

First Plaintiffs

AND OTHERS NAMED IN THE SCHEDULE

Plaintiffs

Affidavit of: Vaughan Neil Strawbridge

Address: Grosvenor Place, 225 George Street, Sydney NSW 2000

Occupation: Registered Liquidator and Chartered Accountant

Date: 2 July 2020

Document number

Details Paragraph Page

1. Affidavit of Vaughan Neil Strawbridge in support of application for orders under section 447A(1) and 588FM, of the Corporations Act 2001 (Cth) sworn on 2 July 2020.

All 1–16

2.

Exhibit “VNS-4”, being an extract of the Personal Property Securities Register of Tiger International Number1 Pty Ltd (Administrators Appointed) ACN 606 131 944 dated a 23 June 2020.

18 -

L\336056700.3

2

Document number

Details Paragraph Page

3. Confidential Exhibit “VNS-5”, being a bundle of confidential documents exhibited to the deponent.

8 -

I, Vaughan Neil Strawbridge, of Deloitte Touche Tohmatsu (of which Deloitte Financial Advisory

Pty Ltd is a wholly owned subsidiary) (Deloitte), at Level 9 Grosvenor Place, 225 George

Street, Sydney, New South Wales, Registered Liquidator and Chartered Accountant, say on

oath:

1. I am a partner in the Financial Advisory Group of the professional services firm trading

as Deloitte. I am a Chartered Accountant and a Registered Liquidator and I have

practised for more than 25 years as an accountant specialising in insolvency related

matters in Australia, Thailand and the United Kingdom.

2. I am one of the four joint and several voluntary administrators of each of the Second to

Fortieth Plaintiffs (Virgin Companies), together with Mr Salvatore Algeri, Mr John Greig

and Mr Richard Hughes (together, the Administrators and each an Administrator). Mr

Algeri, Mr Greig and Mr Hughes are also partners of Deloitte.

3. I am authorised by Mr Algeri, Mr Greig and Mr Hughes to make this affidavit on behalf of

the Administrators. Where I depose below to the view or views of the Administrators,

they are the view(s) which each of I, Mr Algeri, Mr Greig and Mr Hughes hold at the date

of swearing this affidavit.

4. Unless otherwise stated, I make this affidavit based on my own knowledge and belief

and from information I and staff members at Deloitte have obtained through my role as

an Administrator of the Virgin Companies, which I believe to be true.

5. This is the sixth affidavit that I have sworn in these proceedings.

6. I refer to and rely upon my:

(a) affidavit of 23 April 2020 (First Affidavit);

(b) supplementary affidavit of 24 April 2020 (Second Affidavit);

(c) affidavit of 11 May 2020 (Third Affidavit);

(d) supplementary affidavit of 11 May 2020 (Fourth Affidavit); and

(e) supplementary affidavit of 15 May 2020 (Fifth Affidavit),

each filed in the Proceeding.

L\336056700.3

3

7. I also refer to and rely upon the affidavit of Salvatore Algeri of 22 May 2020 (Algeri

Affidavit).

8. Exhibited to me at the time of swearing this affidavit is a bundle of documents, to which I

make reference in this affidavit marked "VNS-5" (Confidential Exhibit)

9. I make this affidavit in support of the relief sought by the Plaintiffs in the Interlocutory

Process filed in these proceedings on 1 July 2020 (Application), namely, orders under

sections 447A(1) and 588FM of the Corporations Act 2001 (Cth) (Corporations Act)

and sections 37AF and 37AG of the Federal Court of Australia Act 1976 (Cth) (Federal

Court Act). Those orders in effect seek:

(a) orders modifying the manner in which the Administrators would (or might) be

personally liable under s 443A of the Corporations Act in respect of certain

obligations of the Virgin Companies and the Administrators arising under the

Transaction Documents (defined at paragraph 14 below);

(b) an order pursuant to s 588FM of the Corporations Act in respect of security interests

created in connection with

(i) the General Security Agreement dated 26 June 2020 between the First

Plaintiffs, the Second to Tenth Plaintiffs, the Thirteenth Plaintiff, the Nineteenth

to Twenty-Fourth Plaintiffs, the Fortieth Plaintiff, and Global Loan Agency

Services Australia Nominees Pty Ltd; and

(ii) the Charge Over Shares dated 26 June 2020 between the First Plaintiffs, the

Seventh Plaintiff, and Global Loan Agency Services Australia Nominees Pty

Ltd,

the time for registration of the security is fixed to be, for the purposes of

s 588FL(2)(b)(iv) of the Corporations Act, 24 July 2020 so that the security

interests are effective; and

(c) until further order, and by no later than 1 July 2021, an order that pursuant to

s 37AF(1)(b)(i) and (i), of the Federal Court Act, on the ground stated in s

37AG(1)(a), Exhibit VNS-5 be made confidential and prohibited from disclosure to

any person other than:

(i) the Judge hearing the matter and the Judge's staff and assistants; and

(ii) Bain Capital

L\336056700.3

4

Sale Process

10. The circumstances in which the Administrators were appointed as joint and several

administrators of each of the Virgin Companies, the corporate structure of the Virgin

Companies and the general nature of the business conducted by the Virgin Companies

(Business), are set out in the First and Third Affidavits.

11. As noted in the Third Affidavit and the Algeri Affidavit, following our appointment as

administrators of the Companies, the Administrators immediately commenced a

comprehensive global sale process seeking expressions of interest and ultimately

binding offers for the sale and/or recapitalisation of the Business and assets of the Virgin

Companies (Sale Process). To assist with the Sale Process, the Administrators

engaged the services of Houlihan Lokey, specialist debt restructuring firm of financial

advisors, and Morgan Stanley, an investment bank.

12. The Administrators formed the view that given:

(a) the significant cash constraints facing the Virgin Companies;

(b) the impact of the COVID-19 pandemic on the conduct of the Business; and

(c) the need to retain key contracts, assets, employees and regulatory approvals to

preserve the value of the Business,

the Sale Process needed to be conducted on an expedited time frame and yield a

satisfactory transaction as soon as reasonably practicable, having regard to the scale

and complexity of the Business.

13. The steps undertaken by the Administrators in relation to the Sale Process, either

ourselves or through our advisors, were as follows:

(a) on and from 21 April 2020, Houlihan Lokey issued non-disclosure agreements and a

flyer to a total of 85 interested parties seeking proposals for a sale and/or

recapitalisation of the Virgin Companies or substantially all of their assets (see

paragraphs [44]-[45] of the Third Affidavit);

(b) on and from 27 April 2020, Houlihan Lokey:

(i) established a secure data room containing documents regarding the Business

and the financial position of the Virgin Companies (Data Room) (see

paragraphs [44] and [46] of the Third Affidavit);

(ii) prepared an information memorandum and distributed it to parties that had

entered into non-disclosure agreements with the Administrators (see

paragraphs [44] and [46] of the Third Affidavit);

L\336056700.3

5

(c) as at 11 May 2020, a total of 19 parties considered potential purchasers had been

granted access to the Data Room (see paragraph [47] of the Third Affidavit);

(d) on 15 May 2020, the Administrators received several non-binding indicative offers

and, based on those offers, formed a shortlist of interested parties which, in the

Administrators’ opinion, were the parties most likely to be able ultimately to make a

credible offer for the Business (Shortlisted Bidders) (see paragraph [42] of the

Algeri Affidavit);

(e) on and from 15 May 2020, the Administrators and our advisors worked with the

Shortlisted Bidders in 'Phase 2' of the Sale Process to facilitate the Shortlisted

Bidders to make the best offers they could in the circumstances (see paragraph [42]

of the Algeri Affidavit), including:

(i) arranging virtual meetings, presentation and "Q&A" opportunities and

"roadshows" between the interested parties and management personnel of the

Virgin Companies;

(ii) sharing more detailed financial and operational information, including provision

of vendor due diligence prepared by the Administrators' legal advisors,

Clayton Utz;

(iii) facilitating meetings between the interested parties and as many aircraft

financiers, aircraft lessors, real property landlords, suppliers, unions and other

key stakeholders of the Business as could be managed in the available time;

(f) on 29 May 2020, five final non-binding indicative proposals for Phase 2 of the Sale

Process were received from the Shortlisted Bidders;

(g) on 2 June 2020, the Administrators selected two final preferred bidders, comprising

Bain Capital and Cyrus Capital Partners, L.P (Cyrus Capital), to proceed to 'Phase

3' of the Sale Process;

(h) on and from 2 June 2020, the Administrators and their advisers were engaged in

extensive negotiations with Bain Capital and Cyrus Capital in relation to all aspects

of a proposed transaction, including the form of the documents to give effect to a

transaction. To assist with the consideration of competing proposals, the

Administrators requested that Bain and Cyrus Capital review a draft Sale and

Implementation Deed and a term sheet for the provision of interim funding (amongst

other documents), and to submit their proposals for the sale and/or recapitalisation of

the Virgin Companies or substantially all of their assets by reference to those

documents;

L\336056700.3

6

(i) on 22 June 2020, the Administrators received final binding offers from Bain Capital

and Cyrus Capital;

(j) on 24 June 2020, the Administrators received a back-up recapitalisation proposal (in

the form of a deed of company arrangement proposal) as well as an offer of interim

funding (which was conditional on acceptance of the back-up recapitalisation

proposal) from two holders of the unsecured notes issued by the Second Plaintiff,

Virgin Australia Holdings Ltd;

(k) on 26 June 2020, Cyrus Capital withdrew its offer; and

(l) also on 26 June 2020, following the Administrators' consideration and assessment of

the competing proposals (with the assistance of their financial advisers), the

Administrators accepted the offer submitted by Bain Capital.

The Transaction Documents, the Proposed Transaction and the context for the

Application

14. On 26 June 2020, to give effect to the transaction proposed under the offer made by

Bain Capital (the Transaction), the Administrators executed, both in our capacity as

Administrators of the Virgin Companies and also on behalf of each of the Virgin

Companies, a number of documents (collectively, the Transaction Documents).

15. The following facts and elements in relation to the Transaction and Transaction

Documents are relevant for the purposes of the Application (references to Bain Capital

or the Purchaser are references to it or its nominee entity/ies)

(a) the Administrators, the Virgin Companies and the Purchaser have executed a sale

and implementation deed (the Sale Deed);

(b) pursuant to the Sale Deed:

(i) the Administrators will continue to trade the Business as usual while

completion of the Transaction is pending;

(ii) the Administrators are not personally liable, except to the extent that the

assets owned by the Virgin Companies and used in the conduct of the

Business are available to satisfy the Administrators' statutory right of indemnity

and lien arising under sections 443D, 443E and 443F of the Corporations Act

(Administrators’ Lien);

(c) the Administrators obtain certain Court orders to give effect to key elements of the

Transaction (and may obtain orders to limit their personal liability), including the

orders sought in this Application;

L\336056700.3

7

(d) in relation to this Application:

(i) the administrators are required, pursuant to the Sale Deed, to make an

application within 5 business days of its execution (i.e., by 3 July 2020) for:

(A) an order under section 588FM of the Corporations Act fixing a later

time for registration of security interests on the register under the

Personal Property Securities Act 2009 (Cth) (PPSA) for the purposes

of section 588FL(2)(b)(iv) of the Corporations Act; and

(B) such orders as the Administrators consider are necessary or prudent

(including orders under section 447A of the Corporations Act to modify

the operation of section 443A of the Corporations Act) in respect of the

Sale Deed.

existing creditor profile of the Grantors

16. Security is granted by certain of the Virgin Companies (together, Grantors and each a

Grantor) as set out in the table below:

Party Entity

Second Plaintiff Virgin Australia Holdings Ltd (Administrators

Appointed) ACN 100 686 226

Third Plaintiff Virgin Australia International Operations Pty Ltd

(Administrators Appointed) ACN 155 859 608

Fourth Plaintiff Virgin Australia International Holdings Pty Ltd


Fifth Plaintiff Virgin Australia International Airlines Pty Ltd


Sixth Plaintiff Virgin Australia Airlines (SE Asia) Pty Ltd


Seventh Plaintiff Virgin Australia Airlines Holdings Pty Ltd


Eighth Plaintiff VAH Newco No.1 Pty Ltd (Administrators


L\336056700.3

8

Party Entity

Ninth Plaintiff Tiger Airways Australia Pty Limited


Tenth Plaintiff Virgin Australia Airlines Pty Ltd (Administrators


Thirteenth Plaintiff Virgin Tech Pty Ltd (Administrators Appointed)

ACN 101 808 879

Nineteenth Plaintiff A.C.N. 098 904 262 Pty Ltd (Administrators


Twentieth Plaintiff Virgin Australia Regional Airlines Pty Ltd


Twenty-first Plaintiff Virgin Australia Holidays Pty Ltd (Administrators


Twenty-second Plaintiff VB Ventures Pty Ltd (Administrators Appointed)

ACN 125 139 004

Twenty-third Plaintiff Virgin Australia Cargo Pty Ltd (Administrators


Twenty-fourth Plaintiff VB Leaseco Pty Ltd (Administrators Appointed)

ACN 134 268 741

Fortieth Plaintiff Tiger International Number1 Pty Ltd


(a) the Grantors provide a limited form of security over the following assets:

(i) all present and future interests in any shares in any company, corporation,

body corporate or other entity from time to time registered in the name of the

respective Grantor (Shares);

(ii) all present and future property and rights attaching to or arising out of or

otherwise in respect of the holding of an interest in the Shares; and

L\336056700.3

9

(iii) any aircraft or engines which any of the Grantors has an interest in, other than:

(A) any aircraft or aircraft engine which a Grantor owns free and clear of

any security interest in favour of any other party; and

(B) the proceeds of any sale or other realisation of any aircraft, aircraft

engine or other part of any aircraft which a Grantor owns; and

(b) the Security Trustee will not have priority over any existing security interest granted

to a secured party by any of the Grantors which is mandatorily preferred by law or

approved by the Security Trustee and Bain Capital as a priority security.

Existing secured creditors of the Virgin Companies

17. An extract of the securities interests recorded against each of the Grantors on the

Personal Property Securities Register (PPSR) obtained on 21 April 2020 is located at

Tabs 105 - 113, 116, 122 - 127 of Exhibit VNS-1 as specified below.

Party Entity Tab in VNS-1

Second Plaintiff Virgin Australia Holdings Ltd

(Administrators Appointed) ACN 100 686

226

105

Third Plaintiff Virgin Australia International Operations

Pty Ltd (Administrators Appointed) ACN

155 859 608

106

Fourth Plaintiff Virgin Australia International Holdings

Pty Ltd (Administrators Appointed) ACN

155 860 021

107

Fifth Plaintiff Virgin Australia International Airlines Pty

Ltd (Administrators Appointed) ACN 125

580 823

108

Sixth Plaintiff Virgin Australia Airlines (SE Asia) Pty Ltd


389

109

Seventh Plaintiff Virgin Australia Airlines Holdings Pty Ltd


110

L\336056700.3

10

Party Entity Tab in VNS-1

675

Eighth Plaintiff VAH Newco No.1 Pty Ltd (Administrators


111

Ninth Plaintiff Tiger Airways Australia Pty Limited


008

112

Tenth Plaintiff Virgin Australia Airlines Pty Ltd


965

113

Thirteenth

Plaintiff

Virgin Tech Pty Ltd (Administrators


116

Nineteenth

Plaintiff

A.C.N. 098 904 262 Pty Ltd


262

122

Twentieth

Plaintiff

Virgin Australia Regional Airlines Pty Ltd


662

123

Twenty-first

Plaintiff

Virgin Australia Holidays Pty Ltd


159

124

Twenty-second

Plaintiff

VB Ventures Pty Ltd (Administrators


125

Twenty-third

Plaintiff

Virgin Australia Cargo Pty Ltd


838

126

Twenty-fourth

Plaintiff

VB Leaseco Pty Ltd (Administrators


127

L\336056700.3

11

18. An extract of the securities interests recorded against the Fortieth Plaintiff on the PPSR

obtained on 23 June 2020 is located at Exhibit VNS-4.

19. The PPSR searches disclosed that 3,073 registrations (Registrations) had been made

against assets or property of the Grantors (in total) on the PPSR. Of the Registrations,

716 are in the collateral class of "all present and after acquired" property (with or without

exceptions) (All-PAAP Registrations).

20. To date, no secured party has enforced its security interest over the assets and

undertaking of the Virgin Companies or any specific property (for example, it has not

appointed a receiver and manager). To the best of my knowledge, none of the All-PAAP

Registrations secure the whole or substantially the whole of the assets of the Grantors.

Other creditors of the Virgin Companies

21. The first meeting of creditors for:

(a) each of the Second to Thirty-Ninth Plaintiffs was held concurrently on 30 April 2020;

and

(b) the Fortieth Plaintiff was held on 11 May 2020,

(together, the First Meetings).

22. Pursuant to the Orders of Justice Middleton dated 24 April 2020 (24 April Orders) (and

later extended to include the Fortieth Plaintiff pursuant to orders made on 15 May 2020),

the Court ordered that one committee of inspection be formed in respect of the Virgin

Companies (Committee of Inspection).

23. On 12 May 2020, the creditors resolved that the following creditors are members of the

Committee of Inspection.

No. Creditor Creditor

Category

1. FIIG Securities Limited Bondholder

2. Northern Trust Asset Management Bondholder

3. Sargon CT Pty Ltd Bondholder

4. The Bank of New York Mellon Bondholder

5. Association of Virgin Australia Group Pilots (VIPA) Employee

6. Australian Council of Trade Unions (ACTU) Employee

7. Australian Federation of Air Pilots (AFAP) Employee

L\336056700.3

12

8. Australian Licensed Aircraft Engineers (ALAEA) Employee

9. Australian Manufacturing Workers Union (AMWU) Employee

10. Australian Services Union (ASU) Employee

11. Dayna Field Employee

12. Flight Attendants Association of Australia (FAAA) Employee

13. SALPA (Skywest Airlines Pilot Association) Employee

14. Transport Workers Union of Australia Employee

15. Electrical Trades Union (ETU) Employee

16. Australia Pacific Airports (Melbourne) Pty Ltd Landlord

17. Brisbane Airport Corporation Pty Ltd Landlord

18. Canberra Airport Pty Ltd Landlord

19. Gold Coast Airport Pty Ltd Landlord

20. Perth Airport Pty Ltd Landlord

21. Sydney Airport Corporation Limited Landlord

22. Velocity Rewards Pty Ltd Other

23. Airframe Leasing (S) Pte. Ltd. Secured Creditor

24. AS Air Lease Holdings (Castlelake) Secured Creditor

25. Dell Financial Services Pty Ltd Secured Creditor

26. JPA No. 123 Co., Ltd Secured Creditor

27. Perth Aircraft Leasing (UK) Limited Secured Creditor

28. Wilmington Trust Company (AerCap) Secured Creditor

29. Deputy Commissioner of Taxation Statutory

30. Sabre GLBL Inc. Trade Creditor

31. Airline Cleaning Services Pty Ltd Trade Creditor

32. Alliance Airlines Pty Ltd Trade Creditor

33. Boeing Training & Flight Services Australia Pty Ltd Trade Creditor

34. Carlson Wagonlit Travel Australia Pty Ltd Trade Creditor

L\336056700.3

13

35. Spotless Facility Services Pty Ltd Trade Creditor

36. Commonwealth of Australia (Fair Entitlements

Guarantee) (Observer only)

Contingent

24. I presided at a meeting of the Committee of Inspection held on 1 July 2020 at 11am. At

the meeting, I informed the Committee of Inspection that the Administrators had caused

the Virgin Companies to enter into a facility to fund the ongoing administration and had

granted security to support that borrowing. I also informed the Committee of Inspection

that the Administrators would make an application to Court seeking the relief sought in

the Application. No objection to that course was made by any member of the Committee

of Inspection at the meeting.

25. From our review of the books and records of the Virgin Companies, the Administrators

have identified that the Virgin Companies have approximately 10,247 known creditors in

total (including approximately 9,020 employees), not including customers entitled to

credits for flights which were cancelled due to the pandemic.

26. The Virgin Companies' creditor profiles can be broadly summarised as follows:

(a) lenders under secured corporate debt and aircraft financing facilities, who are owed

approximately $2,283,639,303;

(b) unsecured bondholders, who are owed approximately $1,988,250,000

(c) trade creditors, who are owed approximately $166,704,085.69;

(d) aircraft lessors, who are owed approximately $1,883,914,848;

(e) landlords, who are owed approximately $71,209,929; and

(f) employees, who are owed approximately $450,777,961.

27. Employees who continue to be employed by the Virgin Companies during the

administration are being paid their wage and superannuation entitlements in the ordinary

course.

Relief under sections 447A(1) and 588FM of the Corporations Act

28. I am aware that, pursuant to the Administrators' Lien, the Administrators are entitled to

be indemnified out of the Virgin Companies’ assets (other than PPSA retention of title

property) for:

(a) debts for which the Administrators are liable pursuant to sections 443A, 443B and

443BA of the Corporations Act; and

L\336056700.3

14

(b) any other debts or liabilities incurred, or damages sustained, in good faith and

without negligence, by the Administrators in our performance or exercise, or

purported performance or exercise, of any of our functions or powers as

administrators.

29. I am of the view (which is shared by the other Administrators) that entering into the

Transaction and the Transaction Documents was in the best interests of the Virgin

Companies and its creditors because, among other reasons, the Transaction:

(a) reflected the culmination of the Sale Process; and

(b) was crucial for the ongoing trading of the Business to enable the Administrators to

continue to trade the Virgin Companies and meet ongoing liabilities to progress the

external administration of the Virgin Companies.

30. Based on my experience as an administrator, I am of the view (which is shared by the

other Administrators) that the making of the orders sought in the Application would not

prejudice other creditors of the Grantors or the Virgin Companies (including secured

creditors (such as aircraft lessors), priority creditors (such as employees), and other

unsecured creditors (such as bondholders)) and is in the best interests of the Grantors

and the Virgin Companies as a whole pursuant to the objectives of Part 5.3A of the

Corporations Act.

31. My reasons for forming this view are that:

(a) on the Administrators’ assessment of offers received following the Sale Process, the

Transaction contemplated under the Transaction Documents was the most

favourable transaction available for the benefit of creditors of the Grantors and the

Virgin Companies as a whole (insofar as it provided the greatest prospect of the

Business remaining intact and otherwise provided the likely greatest return to

creditors;

(b) pursuant to the terms of the Sale Deed, the facility extended is an integral part of the

overall funding of the Transaction, will not affect the financial outcome to creditors if

the Transaction completes by way of either a deed of company arrangement or

through an asset sale;

(c) the Virgin Companies would not be able to continue to trade up to the date of the

Second Meeting without receipt of the funding – that result would imperil the

prospect of the Administrators being able to sell the assets of the Business as a

going concern, which would in turn:

L\336056700.3

15

(i) potentially lead to the Administrators having to make decisions in relation to

maintenance, flying schedules and other matters that may lead to the loss of

necessary regulatory approvals and slots for take-off and landing at airports;

and

(ii) more generally, result in a worse outcome for creditors;

(d) having regard to my understanding of the financial position of the Virgin Companies,

the funding and the Transaction were essential to ensure the ongoing viability of the

Virgin Companies and to ensure that the return for unsecured creditors is

maximised;

(e) as set out above, existing secured creditors will not be prejudiced, as the grant of

security interests in favour of Bain Capital will be registered on the PPSR later in

time, and therefore rank lower in priority to those security interests;

(f) the repayment of the funding will not alter the outcome for the Virgin Companies'

unsecured creditors or employees given that the trading liabilities which will be met

by the funding would in any event be the subject of the Administrators' Lien, and thus

rank ahead of unsecured creditors in the section 556(1) priority waterfall in all

instances; and

(g) Bain Capital has itself agreed that the obligations of the Administrators are

essentially limited to recourse to the assets available in the administrations of each

of the Virgin Companies.

Swearing of this Affidavit

32. I have not been able to swear this affidavit in proper form at the time that I have signed it

due to the measures I have taken to minimise the spread of COVID-19.

33. I have been informed by Kassandra Suzann Adams, as the proposed witness to this

affidavit, and believe, that the relaxation of formality with respect to the unsworn nature

of this affidavit does not diminish the need for me to satisfy myself that the contents of

this affidavit are true and correct. I have satisfied myself that that is the case.

34. I will formally swear this affidavit when circumstances allow and will instruct Clayton Utz

to file the sworn version with the Court.

L\336056700.3

16

Sworn by the deponent

at Sydney

in New South Wales

on 2 July 2020

Before me:

) ) ) ) )

Signature of deponent

Signature of witness Kassandra Suzann Adams, solicitor.

L\336056700.3

17

SCHEDULE

Federal Court of Australia No. NSD 464 of 2020 District Registry: New South Wales Division: General IN THE MATTER OF VIRGIN AUSTRALIA HOLDINGS LTD (ADMINISTRATORS APPOINTED) ACN 100 686 226 & ORS

Plaintiffs

First Plaintiffs: Vaughan Strawbridge, Salvatore Algeri, John Greig and Richard Hughes, in their capacity as joint and several voluntary administrators of each of the Second to Fortieth Plaintiffs

Second Plaintiff: Virgin Australia Holdings Ltd (Administrators Appointed) ACN 100 686 226

Third Plaintiff Virgin Australia International Operations Pty Ltd (Administrators Appointed) ACN 155 859 608

Fourth Plaintiff: Virgin Australia International Holdings Pty Ltd (Administrators Appointed) ACN 155 860 021

Fifth Plaintiff: Virgin Australia International Airlines Pty Ltd (Administrators Appointed) ACN 125 580 823

Sixth Plaintiff: Virgin Australia Airlines (SE Asia) Pty Ltd (Administrators Appointed) ACN 097 892 389

Seventh Plaintiff: Virgin Australia Airlines Holdings Pty Ltd (Administrators Appointed) ACN 093 924 675

Eighth Plaintiff: VAH Newco No.1 Pty Ltd (Administrators Appointed) ACN 160 881 345

Ninth Plaintiff: Tiger Airways Australia Pty Limited (Administrators Appointed) ACN 124 369 008

Tenth Plaintiff: Virgin Australia Airlines Pty Ltd (Administrators Appointed) ACN 090 670 965

Eleventh Plaintiff: VA Borrower 2019 No. 1 Pty Ltd (Administrators Appointed) ACN 633 241 059

L\336056700.3

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Twelfth Plaintiff: VA Borrower 2019 No. 2 Pty Ltd (Administrators Appointed) ACN 637 371 343

Thirteenth Plaintiff: Virgin Tech Pty Ltd (Administrators Appointed) ACN 101 808 879

Fourteenth Plaintiff: Short Haul 2018 No. 1 Pty Ltd (Administrators Appointed) ACN 622 014 831

Fifteenth Plaintiff: Short Haul 2017 No. 1 Pty Ltd (Administrators Appointed) ACN 617 644 390

Sixteenth Plaintiff: Short Haul 2017 No. 2 Pty Ltd (Administrators Appointed) ACN 617 644 443

Seventeenth Plaintiff: Short Haul 2017 No. 3 Pty Ltd (Administrators Appointed) ACN 622 014 813

Eighteenth Plaintiff: VBNC5 Pty Ltd (Administrators Appointed) ACN 119 691 502

Nineteenth Plaintiff: A.C.N. 098 904 262 Pty Ltd (Administrators Appointed) ACN 098 904 262

Twentieth Plaintiff: Virgin Australia Regional Airlines Pty Ltd (Administrators Appointed) ACN 008 997 662

Twenty-first Plaintiff: Virgin Australia Holidays Pty Ltd (Administrators Appointed) ACN 118 552 159

Twenty-second Plaintiff: VB Ventures Pty Ltd (Administrators Appointed) ACN 125 139 004

Twenty-third Plaintiff: Virgin Australia Cargo Pty Ltd (Administrators Appointed) ACN 600 667 838

Twenty-fourth Plaintiff: VB Leaseco Pty Ltd (Administrators Appointed) ACN 134 268 741

Twenty-fifth Plaintiff: VA Hold Co Pty Ltd (Administrators Appointed) ACN 165 507 157

Twenty-sixth Plaintiff: VA Lease Co Pty Ltd (Administrators Appointed) ACN 165 507 291

Twenty-seventh Plaintiff: Virgin Australia 2013-1 Issuer Co Pty Ltd (Administrators Appointed) ACN 165 507 326

Twenty-eighth Plaintiff: 737 2012 No.1 Pty. Ltd (Administrators Appointed) ACN 154 201 859

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Twenty-ninth Plaintiff: 737 2012 No. 2 Pty Ltd (Administrators Appointed) ACN 154 225 064

Thirtieth Plaintiff: Short Haul 2016 No. 1 Pty Ltd (Administrators Appointed) ACN 612 766 328

Thirty-first Plaintiff: Short Haul 2016 No. 2 Pty Ltd (Administrators Appointed) ACN 612 796 077

Thirty-second Plaintiff: Short Haul 2014 No. 1 Pty Ltd (Administrators Appointed) ACN 600 809 612

Thirty-third Plaintiff: Short Haul 2014 No. 2 Pty Ltd (Administrators Appointed) ACN 600 878 199

Thirty-fourth Plaintiff: VA Regional Leaseco Pty Ltd (Administrators Appointed) ACN 127 491 605

Thirty-fifth Plaintiff: VB 800 2009 Pty Ltd (Administrators Appointed) ACN 135 488 934

Thirty-sixth Plaintiff: VB Leaseco No 2 Pty Ltd (Administrators Appointed) ACN 142 533 319

Thirty-seventh Plaintiff: VB LH 2008 No. 1 Pty Ltd (Administrators Appointed) ACN 134 280 354

Thirty-eighth Plaintiff: VB LH 2008 No. 2 Pty Ltd (Administrators Appointed) ACN 134 288 805

Thirty-ninth Plaintiff: VB PDP 2010-11 Pty Ltd (Administrators Appointed) ACN 140 818 266

Fortieth Plaintiff: Tiger International Number 1 Pty Ltd (Administrators Appointed) ACN 606 131 944